13.03.22 Restructuring German energy imports Author: Christian Buck • Reading time: 3 min.

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Summary

The war in Ukraine has caused the German government to rethink Germany’s policy on energy. In particular in the case of gas, the aim is to reduce the country’s dependency on Russia. Liquefied natural gas (LNG) is available as an alternative in the short term, which is why the plans to build a terminal in Wilhelmshaven have been given a new impetus. In the long term, a “green energy hub” will be created there.

Germany has very few deposits of raw materials and therefore is heavily dependent on energy imports from all over the world. One example is natural gas. More than 90 percent of the gas that Germany needs comes from outside the country. Last year alone, Germany imported almost 90 billion cubic meters of natural gas. Over half of this (roughly 55 percent) was supplied by Russia. In the case of crude oil, the proportion is slightly smaller, but at around one third it is still very high. Other supplier countries, such as Norway and the Netherlands, are not able to replace the Russian gas and oil at short notice.
Because of the war in Ukraine, the German government is currently working on reducing Germany’s dependency on exports of raw materials from Russia. There are two key aspects to this: ensuring the short-term security of supply in Germany and the rest of Europe and moving to other suppliers as quickly as possible.

Safeguarding supplies

According to the German government, the existing energy flows based on the current contracts with Russia must be maintained, at least initially, so that private and commercial consumers can continue to rely on the availability of energy. “At the moment, we cannot safeguard Europe’s energy supplies for heating, transport, electricity generation, and industrial use in any other way,” said German chancellor Olaf Scholz . The German Association of Energy and Water Industries (BDEW) also warned against an embargo on Russian energy supplies. It is concerned that this would have a massive negative impact on the German economy and on consumers .

At the same time, the government also believes that the energy used in Germany and in Europe needs to come from a wider range of sources in the short, medium, and long term, because this will make the supply less susceptible to geopolitical risks. “The real route to energy independence is to phase out fossil fuels,” said Robert Habeck , Minister for Economic Affairs and Climate Action. “The sun and the wind don’t belong to anyone.” However, it will be years before Germany can meet its electricity needs, for example, from wind and solar power alone. This is why we are currently hearing heated debates about longer lifetimes for coal-fired power stations and postponing the phase-out of nuclear power.

Liquefied gas as a stopgap

Experts are of the opinion that liquefied natural gas or LNG is an important alternative to Russian gas. LNG is natural gas that has been liquefied at temperatures below minus 162 degrees Celsius. It is transported by ship to customers throughout the world where it is gasified again and fed into natural gas pipelines. One shipload is enough to supply a large city for a year . The main suppliers of LNG include the USA, Qatar, Australia, and Russia. Around 180 billion cubic meters are available in the short term on the world market. The remaining 320 billion cubic meters are already allocated, for example to customers in Asia. To replace all the supplies from Russia, Europe would need approximately 190 billion cubic meters of LNG.

However, Germany does not currently have one single LNG terminal. Plans to construct one were shelved some time ago because of a lack of interest. Now energy suppliers, including Uniper, have restarted work on a national LNG import terminal in Wilhelmshaven to support the German government in its efforts to restructure energy imports. The aim in the long term is to turn the German port on the Jade Bight on Germany’s North Sea coast into a “green energy hub,” where renewable ammonia will be imported and sustainable hydrogen will be produced. More than ten percent of the hydrogen needed by the German economy by 2030 will come from Wilhelmshaven.

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